Hain Celestial Buys Imagine Foods 32298

Hain Celestial Buys Imagine Foods

UNIONDALE, N.Y.--The Hain Celestial Group Inc. (NASDAQ:HAIN)acquired Imagine Foods Inc., a privately held, non-dairy beverage company withbrands that include Rice Dream and Soy Dream. Terms of the transaction were notdisclosed, but Hain Celestial reported the acquisition would boost the company'searnings by $.02 to $.03 per share during the 2003 fiscal year and by $.08 to$.11 by fiscal 2004. The Dec. 3 edition of The New York Times (www.nytimes.com)reported that Hain Celestial would also be assuming Imagine Foods' $1.5 milliondebt.

Irwin D. Simon, Hain Celestial's chairman and chief executive officer (CEO),reported the acquisition would enhance the company's current product offerings."In non-dairy beverages, Imagine will strengthen our offering to ournatural and retail customers," he said. "With Westsoy, Rice Dream andSoy Dream, we will bring increased scale to both the aseptic aisle and therefrigerated, non-dairy beverages section." The addition of Imagine Organicaseptic soups and broths should further boost Hain's double-digit growth in thatarea. "Additionally, Imagine Natural Organic soups give us a much strongerfoothold in ready-to-eat soups," Simon said.

According to Imagine Foods' CEO and founder, Robert Nissenbaum, the timingwas right to join forces with Hain Celestial. "We can look forward todeveloping even more new products and creating growth for all of the expandedHain Celestial Group's brands," he said.

Nissenbaum will be joining Hain Celestial in a new product development role.A spokesperson for Hain Celestial reported that the company will be evaluatingthe future roles of Imagine staffers at Hain Celestial

According to The Times, the companies first met to discuss sellingImagine Foods in 2001, but it was put on hold after the companies failed toagree on a sale price. Reportedly, Imagine Foods posted revenues of $70 millionin its most current fiscal year; Hain Celestial had net sales of $396 millionfor its fiscal year, ended June 30.

"I think it was definitely a good deal for Hain Celestial, given theaccretion to earnings, and it was a good time for Imagine to look to a sale,given the changes going on in the aseptic non-dairy beverage business,"said Scott Van Winkle, CFA, principal at Boston-based Adams, Harkness &Hill, an investment bank. "With the growth of non-dairy beverages moving torefrigerated, it appears to be a strategically sound move for the two leaders inaseptic non-dairy to combine."